States Urge Appeals Court To Revive Monopoly Case Against Facebook

A New York-led coalition of 48 attorneys general on Friday asked a federal appellate court to revive allegations that Facebook used a “buy-or-bury” strategy to monopolize social networking.

“Mark Zuckerberg claims to be building the metaverse, but the actions of Facebook continue to cause significant harm to millions of consumers and many small businesses here in the real world,” New York Attorney General Letitia stated Friday. “Time and again, the social media giant has used its market dominance to force small companies out of business and reduce competition for millions of users.”

The states' lawsuit -- like a similar antitrust case filed by the Federal Trade Commission -- centered on Facebook's acquisition of Instagram (acquired for $1 billion in 2012) and WhatsApp (bought for $19 billion in 2014).



Last June, U.S. District Court Judge James Boasberg in Washington, D.C. dismissed the attorneys general's lawsuit on the ground that they waited too long to sue.

“Facebook’s acquisitions are barred by the doctrine of laches, which precludes relief for those who sleep on their rights,” Boasberg wrote.

"Ultimately, this antitrust action is premised on public, high-profile conduct nearly all of which occurred over six years ago,” Boasberg added. “The complaint’s allegations themselves make clear that the states could easily have brought suit then, just as they make clear that any equitable relief this court could or would order now would greatly prejudice both Facebook and third parties." 

On Friday, New York and the other attorneys general asked the D.C. Circuit Court of Appeals to reverse that decision.

“Laches does not apply against sovereign states suing to protect the public interest, like the states here,” the law enforcement officials wrote. “And even if laches could apply against the states, the district court misapplied the doctrine by failing to afford adequate deference to the states’ critical role in protecting the public interest through antitrust enforcement actions like this one.”

Last June Boasberg also dismissed the complaint brought by the FTC, but he allowed the agency to amend its allegations and bring them again.

This week, he ruled that the FTC could proceed with the revised allegations.

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